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Speaking of "Estate Recovery". My in laws are selling their house and moving to Texas to live with us. Will the State of California, since my MIL was receiving MediCal for awhile, ask my in laws for Estate Recovery for the MIL's time on Medical from the proceeds from the sale of our In Law's home?

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You need to find out just what Medicaid services are MERP'd and how MERP (Medicaid Estate Recovery) is done in CA to see how much of an issue this is going to be. Not all Medicaid programs do recovery. If they were in any long-term care facility (NH or mental health) those are subject to MERP.

Then find out if MERP is done as a CLAIM or as a LEIN for your state. (Like my mom is in TX and it is a claim against the estate so it a probate court action, rather than a lein on the property). These are very different legal processes and how this is done will effect whether or not there will be an issue with the property at closing. Not all Realtors are familiar with MERP and how it can be a big unexpected issue at closing. Most of the bigger realty companies have someone who understands what MERP can do to queer a sale, so be sure to make it clear to the Realtor that Medicaid was provided to one of the owners. Most states Realtor MLS services require the seller to do a check off list of issues on the house for existing problems (like bad water heater), your parents should note somewhere that MediCal was provided to one of the owners somewhere on this form. What could happen is that the title company will require for the seller (your parents) to provide (they pay for) an indemnity agreement on the property BEFORE they will issue title insurance to the new buyer. You may have to shop around to find a title company who will do this too. Almost all mortgage companies now require title insurance too, so if there is a cloud on the title, your parents are toast on doing a sale and going to closing till the cloud is lifted. CA should have a form that is a release of any MERP claim or lien that will need to be attached to the Act of Sale - a good title company should be familiar with this too. Like for TX it is "Authorization & MERP Certification - July, 2009 edition" that gets attached to an act of sale or presented in probate court in order for the property to transfer freely.

Good luck & keep a sense of humor in all this….also get copies of all the real estate stuff as TX will want all documentation on the sale in order for them to ever get on Medicaid in TX plus they will need to show residency in TX too. This has to be done by both of them in super short order upon moving otherwise they will be denied any state programs.
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You would be wise to check for a lien on the property from Medi-Cal or you won't be able to transfer the title and close the sale.
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